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Industry Research : Will BPO Companies Invest in Mindanao to Spur Development?

Oct 10, 2012 -- President Benigno S. Aquino III said he hopes that business process outsourcing companies would soon invest in Mindanao especially with the recently concluded framework agreement between government and the Moro Islamic Liberation Front (MILF).

In his speech during the 4th International Outsourcing Summit in Makati City on Tuesday, the President acknowledged the contribution of the sector as an all-important driver of inclusive growth particularly by extending prosperity outside the traditional hubs of commerce and industry.

Most BPO companies are investing in the so-called Next Wave Cities, which include Santa Rosa in Laguna, Lipa in Batangas, and Dumaguete.

"We are also hard at work to make even more places in the Philippines ripe for investment. With the recently concluded framework agreement with the MILF, we are very hopeful that there will come a day, in the not too distant future, when we see a number of IT-BPO companies operating in the Bangsamoro," the President said.

"The jobs you create in these areas, obviously, take on a multiplier effect that goes a long way in developing the countryside."

The President announced last week that the Philippine government and the MILF was nearing the forging of a Framework Agreement on peace aimed at ending the conflict that has spanned two generations and has taken the lives of more than 100,000 Filipinos.

The Framework Agreement laid down the ground work for achieving the "final and enduring peace in Mindanao" by enjoining all stakeholders to support the implementation of the needed "structural reforms, the chief executive said.

Under the Framework Agreement, a new "political entity" will replace the Autonomous Region in Muslim Mindanao (ARMM) and will be named "Bangsamoro."

Government negotiators and representatives of the MILF who had been holding peace talks in Kuala Lumpur, Malaysia, will soon come out with the draft guidelines on the Framework Agreement soon, the President said.The BPO industry posted $11 billion in revenue in 2011, and created 113,000 new jobs, according to the President. This robust growth of the industry also made the Philippines the number one contact center industry in the world, having surpassed India in 2010.

In 2016, President Aquino said he expects the BPO industry to make $25 billion, while employing around 1.3 million Filipinos.

The BPAP, which is the umbrella association for the IT-BPO and GIC (Global In-House Center) industry in the Philippines, plays a pivotal role in sustaining the rapid growth of the IT-BPO industry by ensuring steady supply of man power, supporting service innovation, and providing country visibility.